Irish Liberty Forum

Lisbon Redux: CCCTB (And Why The EU Is So Dangerous)

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Libertas has correctly pounced on comments from the French finance minister that the CCCTB would be pushed ahead in the Autumn.

No doubt there will be consternation in Government buildings this morning at Ms. Lagarde’s remarks. She’s gone and given the game away!

On a more serious note, the fact of the matter is that a common corporate taxation base is the number one item on the agenda for the European Union after the ratification of the Lisbon Treaty.

A Common corporate tax base would destroy the Irish economy. In a challenging economic environment, the stakes could not be higher.

I agree that this is very worrying, but I can’t help feeling that it’s already too late; that we’ve already been “sold down the river”, as it were; in the words of Peter Hitchens, that Ireland, like Britain, is already a “subject province of a European superstate”.

I remember, years ago, reading “No Logo” by Naomi Klein, in particular Chapter 7, “Mergers and Synergy”, and being genuinely convinced of the threat posed by corporate mergers. It took me a while but I eventually recognised that the power concentrated by merging businesses was as nothing (and of a very different kind) to the power concentrated by merging governments.

An applied comparison would be as follows: ABC and Disney use their merger to enjoy productive synergies from their combined media products on the one hand, while on the other the European governments use the EU to strengthen their monopolistic power of “continual, institutionalized property rights violations” (Hoppe) over European citizens. Are these equally fearful?

The centralised European superstate which we are rapidly approaching will, by abolishing national governments, remove the incentives these have to compete with each other and with other governments around the world.

This crucial idea is something that statists never seem to deal with. They don’t seem to understand (and I don’t blame them – it took me quite a while, and it’s not the sort of thing that gets explained frequently) that a government is really just a type of business: it provides “services” (legal, policing, security, health, education, etc.) to “consumers” (citizens). The only difference between a government and any other kind of business is that a government achieves its objectives through physical force. This is the simple reality: the government is just a special kind of business – one that successfully exercises violent monopoly powers over the people in the territories it controls.

For example, I explained in a comment at Cedar Lounge that the notion of competing governments I have been describing could be used to interpret “the emergence of European civilisation from the Holy Roman Empire, economic growth in a decentralised US through the 19th and early 20th centuries, and the high levels of wealth found today in relatively small, independent countries such as Luxembourg, Switzerland, Ireland, Iceland and Hong Kong (and havens Liechtenstein, Monaco, etc.)”

One reply I got was that “the most powerful agent of centralisation in the modern world is international capital. Given the choice, I think global and regional democracy is better than a dictatorship of such vested interests.”

Obviously this person is approaching the question from somewhere closer to Naomi Klein’s perspective than my own. I believe that my logic stands, but perhaps it’s worth asking the question: whose perspective has the greater interpretative power?

Consider the 2000 merger between Time Inc. and Warner Communications, a huge concentration of power resulting in Time Warner Inc. and ranked as one of the biggest mergers of all time. The new entity had a 2007 revenue of $52.5 billion. Pretty big, right?

Yes it is. But the most recent Irish government budget was bigger than that, at $53 billion. And this is a budget that is obviously miniscule compared to the budgets of other European governments. A merger of all of these governments, as we are witnessing with the EU, is then hundreds of times bigger in sheer monetary power (never mind legal and military power) than even the largest kind of corporate merger. So how does this fit with the idea that “the most powerful agent of centralisation in the modern world is international capital.” Unless we are talking about government capital, I don’t see how it fits at all.

The reasons to oppose the advancement of the EU project are profound and not merely nationalistic or conservative. They are grounded in fundamental truths about the nature of politics, our experience of history and our understanding of political economy. If you have any sense at all of the dangers of centralised power, you should recognise the EU for what it increasingly looks like: a serious threat to our freedoms and prosperity.


Written by Graham

April 8, 2008 at 10:15 pm

Posted in economics, Europe, Ireland, philosophy

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  1. […] Posted on July 10, 2008 by Graham I’ve written at reasonable length before on the nature of the EU, inspired very much by some thoughts expressed by Hoppe. Now I’ve […]

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